During the US-India Trade Policy Forum (TPF) meeting that concluded on Thursday, Indian officials told their American counterparts that they would be in a better position to talk on it once the draft of the model text for the bilateral investment treaty (BIT) is approved by the Cabinet.
“In fact, they wanted us to have a detailed talk on it. The investment treaty is awaiting Cabinet clearance. Draft copies (of BIT) was exchanged,” Commerce Minister Nirmala Sitharaman told Indian reporters at the conclusion of ninth round of India-US TPF, which she co-chaired with the US Trade Representative Mike Froman. Sitharaman told US officials that India would be in a better position to hold talks on it once it is cleared by the Cabinet, which is expected soon.
Responding to a question, Sitharaman said India is not taking away jobs from the US. In fact, Indian investment in the US is giving jobs to thousands of Americans. The US noted India’s concerns over the limitations on mobility of skilled professionals and issues concerning H1B and L1 visas, including the spike in rejection rates of L-1 visas. India also underlined its interest in the early conclusion of a Totalisation Agreement and the need to address the anomaly in US law which requires Indian professionals to pay social security without receiving the related benefits. On totalisation agreement, in her meetings, Sitharaman told the American officials that social security network may not be comparable in countries. “They say as long as we do not have a comparable social security cover in India, they think it may not be fair for them to extend the benefit to us. In the absence of that it is not possible for them to extend (social security cover),” she said.
Next week, Sitharaman is scheduled to attend a meeting of Fortune 500 companies in San Francisco. “This is essentially to talk about investment climate in India. Considering that they are Fortune 500 companies, we certainly want to engage them and explain about things happening in India,” she said.
According to a joint statement issued at the conclusion of India-US TPF, Sitharaman and Froman highlighted the important role of the services sector in the two countries and the significant potential for increasing bilateral services trade and investment. To advance this goal, officials discussed efforts to promote foreign investment in key services sectors. The US urged India to consider policy measures that would facilitate greater participation of foreign companies in service sectors. Both countries reviewed technical engagement that took place in 2015.
Froman welcomed India’s amended Insurance Act that increased foreign investment in the insurance sector from 26 to 49 per cent. The US expressed its concerns over the recently published guidelines on management control in the sector. Both countries agreed to continue to engage on this issue to ensure that insurance companies can take full advantage of this new market opening.
The two leaders noted the important role of services, such as e-commerce, retail and direct selling, in facilitating trade in goods, and took note of developments in these sectors. The US provided information on the positive correlation between investments in the e-commerce and retail sectors, and the expansion of transport, logistics and warehousing infrastructure.